Fintech Amartha Targets Stalls during the Pandemic

Gojek and Grab have been aggressively attracting stalls since the corona pandemic last year. Now it’s the turn of the financial technology startup (fintech lending) Amartha to target grocery stores.

Amartha Chief Commercial Officer Hadi Wenas said the company provides two services for stalls in a special application, namely Amartha Plus. First, Warung Loan Mitra for payment of electricity, credit to shopping stock for partners.

Second, Warung Loan Non-partners. Amartha works closely with the Sampoerna Retail Community (SRC) warung network to provide integrated payment options.

Amartha also provides capital in the form of goods or supplies for stalls. Both are available since last month. Currently, services for non-partners are available in East Java and West Sumatra.

Wenas said the company was eyeing stalls because many Micro, Small and Medium Enterprises (MSMEs) were digitizing businesses during the coronavirus pandemic.

“This service helps mothers to be more digitized,” he said. The potential of stalls in Indonesia is also great. Euromonitor International 2018 research shows that the majority of Indonesians, Indians and Filipinos prefer to shop at grocery stores.

Securities company CLSA also noted that consumer acquisition costs (CACs) through warung partners are around 10-20%, which is US$ 2 per customer or less than Rp 30,000.

The cost is cheaper than the general way. In addition, online to offline (O2O) services, such as warungs, contribute 10% of the total new users in e-commerce.

Many Other Companies Targeting Stalls

Tokopedia and Bukalapak are also targeting stalls. Founder and CEO of Amartha Andi Taufan Garuda Putra said the company’s efforts to target warungs are part of achieving the target of one million female partners this year.

“We are making shop-specific products so that there will be more digitized MSMEs,” he said. Currently, Amartha has attracted more than 200 thousand female MSME partners.

In the first semester, this fintech lending channeled loans of IDR 914 billion or grew 35% on an annual basis (year on year / yoy).

In addition to stalls, Amartha is targeting markets outside Java. “We are confident that this year’s penetration of the outer Java segment will be high. This is Amartha’s value proposition,” said Taufan.

Several other big startups are also aggressively targeting warungs. Gojek, for example, launched the GoToko platform with a business-to-business (B2B) model last year.

The Indonesian Decacorn presents business solutions from upstream to downstream for grocery shop owners.

Grab first provides such services through GrabKios. Decacorn from Singapore acquired a stall digitalization startup, Kudo in 2017, which changed its name to GrabKios in September 2019.

Bukalapak also focuses on developing a business line targeting warungs, namely Mitra Bukalapak.

“We have prepared a strategy to focus on opening the Bukalapak Partner’s offline network, continue to digitize stalls and provide additional infrastructure for them,” said Bukalapak CEO Rachmat Kaimuddin during a virtual press conference last week (9/7).

The red nuanced e-commerce also attracted eight million Bukalapak Partners. Rahmat claims that Bukalapak controls 40% of the kiosk digitization market.

Rudiantara is Appointed as President Commissioner of Amartha

The former Minister of Communication and Information, Rudiantara, was appointed as the main commissioner of Amarta. He has held this position since July 1, 2021. Amartha itself is a financial technology company that focuses on empowering women and the informal economy in the village.

“I am honored to be able to work together with Amartha to accelerate financial services for the underserved (people who are not served) and the underserved (people who have access but only have limited choices),” said Rudiantara in a written statement, Monday (7/19/2021).

Amartha distributes business capital for women micro-entrepreneurs in the village with an average loan value of IDR 3.6 million.

The Amartha business model uses an online to offline system to ensure that the capital is channeled appropriately for productive activities, by providing assistance and training to accelerate digital transformation in rural areas.